Friday, 27 April 2012

There is nothing better than fostering knowledge from somebody who has done it before. In the world of swollen information and perceived gurus, it is refreshing to read real life how to advice from somebody that has started businesses and built them up past $100 million.

Michael covers a lot of excellent material in this book. The critical components are around Time and Quality of Life. No matter how you slice it, time is a finite resource. Respecting your own time and building a business is not always easy to do. Most business owners work way too much for the return. Time is something that needs to be a goal. For example, your goal may be to build a $25 million organization by working only 5 hours per day. Initially this may seem way off base but you will find ways to be most productive in those five hours. You will also need to find the right people.

By setting and manifesting a true time goal, you will be able to dictate your quality of life allowing you to focus on other things. This is no simple task because I have been working toward it for a while and have not hit my goal just yet.

Ready, Fire, Aim examines all businesses based on their growth stage. For the sake of time, I will profile each part in summary.

1. Infancy – The infancy stage is $0 to $1 million in sales. The core skill that needs to be acquired in this stage is selling. You have to sell to eat. In order to sell effectively, you need a unique selling proposition. This proposition communicates value to your potential customers. If you sell business to business then your customer only cares about three things – increasing revenue, reducing costs and mitigating risks. Structure your USP around those three impacts and you will acquire customers. Selling is more important than the infrastructure. You may have to work out of your house or car until you get enough clients to afford new infrastructure.

2. Childhood- This stage is from $1 million to $10 million in sales. The core skill in this stage is marketing. You have proven you can deliver to customers now you have to acquire more customers and have additional products to sell those customers. Honing your skills to cross sell and upsell are critical components to achieving this level of sales. On average it costs 7 times more to get new customers than it does to sell an existing customer. This is why the cross/up sells are so important. The Ready, Fire, Aim strategy comes into play at this stage. Basically you cannot afford to go into paralysis by analysis. You have to try things and move to market quickly. This is compounded through social media networks like LinkedIn, Facebook and Twitter. If you have product ideas then you need to test them using Google and if they prove to be profitable, move them to market. The real goal here is to make a good product and NOT a perfect product. At this stage, you are too small to make a perfect product. If you focus there too much then the market will pass you by and you will lose to your larger competitors.

3. Adolescence-This stage is from $10 million to $50 million in sales. At this stage, leadership and recruiting are critical to building your business. You cannot afford to do it all. This is the biggest trap that entrepreneurs fall into because of their controlling nature and customer contact. If you take Google as an example, they hired Eric Schmidt from Novell to be the CEO. The founders were excellent at what they did but did not (at the time) have the skill set in running a company on its way to dominating the Fortune 500. The key pitfalls to avoid at this stage are Bottlenecks, Bureaucracy and Politics. Bottlenecks are people and procedures that slow things down. Bureaucracy is any systems or protocol that exists independent of the core purpose of the business and politics is the destructive dynamic that results when people pay more attention to power than profit.

2. AdulthoodThis stage is from $50 million to $100 million. At this stage you really need to learn to step out of the way and have excellent people running the company. Warren Buffett is the world’s greatest investor yet he does not run companies. His main focus is capital allocation. He has to put the money to work which means he bets on the easiest businesses with large moats (competitive advantage) and jockeys. Warren will not invest in companies with weak management. He wants committed people with bullet proof business models. He recognizes that his strengths are in placing money and not managing businesses. This is a real trade-off because most Fortune 500 executives work around the clock. As a capital allocator in the business you do not have to do this.

Ready, Fire Aim is an excellent book that provides real world “how to” information that you can use NOW! In order to sustain quality of life, you need to respect your time even as your business grows.

Thanks for reading. Until next time!

-Joe

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Friday, 20 April 2012

Everything rises and falls on leadership. I have always been interested in George S. Patton. Some credit him with America's victory in World War II. Obviously, it was a great team effort that got the job done, but studying General Patton and his role as a leader is good for any aspiring leader.

Why is this important to me?Leadership is needed today more than ever. The generations after World War II have lived in good times. The coming storm of the debt crisis, terrorism and the world economy imploding can potentially result in some very hard times which will require resolve and leadership. The times hardened George Patton to become an excellent leader. He lived through WWI, the Great Depression and WWII. Unfortunately today if the kids have to turn off Xbox then they pout because parents aren’t fair. This is a real problem and why leadership has to be studied.

Timeless Leadership Principles is broken up into three separate sections. Section one outlines all of Patton’s accomplishments during WWII. I highly recommend you study Patton’s history but in a nutshell, he covered more ground with Third Army and was instrumental in winning the war. For the sake of time, I will cover 5 major points from section two of the book. Note: Richard Stillman observed Patton for over a year when Patton commanded Third Army so he had firsthand knowledge of Patton’s Leadership style.

1. Be Physically Fit; Be Mentally Positive; Be Financially Secure – Third Army consisted of 400,000+ soldiers. In order to lead an organization like that, your house needs to be in order. If you are unhealthy, in debt or have a bad attitude then nobody will follow you. In war, leaders know that their direction and decisions are life and death and they need to focus on the tasks and goals at hand. The last things they need to be consumed with are the three basics of everyday worry regarding physical, mental and financial health. A quote from Patton sums this up – “High physical condition is vital to victory, Fatigue makes cowards of us all. Men in condition do not tire.

2. Lead by Example; Go for the Jugular; Be Audacious – Patton delegated authority better than anyone. He understood in order to win the war he needed to be close to the troops and focus on the most important tasks at hand. This included being in the field and walking around with the men in combat zones. He was not an ivory tower manager but an effective leader. Going for the Jugular and never paying for the same real-estate twice won us the war. With Patton, there was no defense. He attacked all the time and never stopped. This is an excellent leadership quality because you are either growing or dying, there is no steady state. These three principles require discipline. According to Patton – “Discipline is based on pride in the profession of arms, on meticulous attention to details, and on mutual respect and confidence. Discipline must be a habit so ingrained that it is stronger than the excitement of battle or the fear of death.”

3. Acquire Expertise in your Profession; Know Your Competition; Publicize your Accomplishments – Patton was an excellent military student of war. He studied history and understood why countries won and lost wars. He also was a student of his competition –German Commander Rommel. He read Rommel’s writings and knew how he did things. One of the greatest feats of WWII was the decoy of the Normandy invasion. The Germans respected Patton and bet that any major offensive would be led by him. Eisenhower knew this and used Patton as a decoy while the Americans stormed Normandy beach. This is the benefits of publicizing your accomplishments. If you are a smart leader, you can use your accomplishments to your team’s advantage.

4. Patton’s Fatal Flaw – Know Your Achilles Heel – Patton made some political mistakes throughout his career in WWII. He was the target of media scrutiny after he slapped a battle fatigued soldier in Italy. Patton was tough and did not want battle wounded men dishonored. After this incident he mistakenly insulted the Russians (not his intent) and it spread like wild fire costing him his command. According to Patton – “Stupid Goddam remark – I know better.” Do you know your Achilles heel? If not then learn it and otherwise it will affect you as a leader.

5. Be an effective writer and speaker – Most people do not know this but George S. Patton was dyslexic. Learning for him was a challenge but he did it anyway. To be an effective leader, you need to be a lifelong learner. Imagine controlling 400,000 lives in the biggest war that history has ever known. This requires dedication of self to the cause. This is much bigger and harder than simply running a business.

General Patton’s Timeless Leadership Principles is a good book and should be read by all aspiring leaders. Great leaders don’t get fired in today’s world and if they do then it is by incompetent people. If you commit yourself to continuous improvement toward a leadership goal then you can secure your future. The world is in short supply of great leadership. I hope you have found this short video summary useful. The key to any new idea is to work it into your daily routine until it becomes habit. Habits form in as little as 21 days. One thing you can take away from this book is discipline. Make discipline a daily objective around your true purpose in life. If you know what that purpose is then establish discipline and create the habits necessary to achieve your life’s ambitions.

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Friday, 13 April 2012

I have some of the other works from Leo and he has an excellent mind set. To accomplish high value task and achieve goals, focus is required. To help in my quest to understand focus, I read this book.

Why is this important to me?
I don’t want to waste your time. If you are investing your time reviewing this summary then it has to be worth it for you. Marcus Aurelius said: Most of what we say and do is not essential. If you can eliminate it, you’ll have more time, and more tranquility. Ask yourself at every moment, “Is this necessary?”

Pablo Picasso – Without great solitude no serious work is possible. These two quotes have real power once they are implemented. Focus is divided into 4 major parts. For the sake of time, I will touch on a concept in each section.

1. Step Back – Email, web browsing, YouTube, Twitter and Facebook. All of these mediums spell one thing – Distraction. Distraction creates stress and wastes time. In May 2011, Americans spent 53.5 billion minutes on Facebook. On average people spend 24 hours per week watching TV and surfing the web. That equates to three full time working days per week. Needless to say, these stats clearly show that people are distracted.

2. Clearing the StreamFocus requires setting a schedule. So one way to clear some of the distractions is to schedule your internet time. Once you put this on the calendar, you can monitor how much time you are truly spending on these activities. This also consolidates your usage and makes you more productive because you are focused on just the internet. Once the time is up then disconnect and tend to your other tasks.

3. Simplify - One excellent technique to simplifying your life is to de-clutter. This means eliminate the non-essentials. Clear off your desk and have a clean working environment. This will eliminate distractions. If you have a stack of crap on your desk then go through it and make a decision – File, Trash or Donate. Make the decision quick and move on. You can do this in your house as well. Having a minimalist life style reduces stress so you can use the same process for your house as you do your desk at work.

Focus – Now that you have performed the first three steps, you can focus on what is meaningful. Decide what the top five priorities are each day and focus on those. Single task each priority until they are done. Multi-tasking on high value tasks does NOT work. Multi-tasking is a recipe for mediocre work and frustrated peers. Have you ever had a conversation with somebody while they are reading email?

Focus is a quick book to read and provides functional “how to” tactics so that you can accomplish high value tasks. You will be amazed at what you can accomplish when you eliminate the non-essentials.

I hope you have found this short summary useful. The key to any new idea is to work it into your daily routine until it becomes habit. Habits form in as little as 21 days. One thing you can take away from this book is to de-clutter. Start de-cluttering your work space and house each day. Do this for 21 days and see how much better you are able to focus on what is really important.

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Friday, 6 April 2012

One of Erin’s team members sent me this book recently so I read it. I was a bit skeptical but Erin’s real world experience going from a comfortable living to the poor house in one day hits home. How many times have you heard people say about their retirement – “I don’t even open my statements anymore because I am scared to look at them.” This book tackles that fear and more.

Why is this important to me?
I don’t want to waste your time. If you are investing your time reviewing this summary then it has to be worth it for you. According to Dr. Maslow, people have a hierarchy of needs. The most basic need is that of security. Money may not buy happiness but it does buy choices and with choices comes freedom. If you were scheduled to retire in 2008 then you saw your 401K portfolio lose have of its value or more. Think about that impact for a moment. You spend 40 years working and saving your money and it takes all of three weeks to lose half of that savings.

Quality of Life needs to be part of any financial plan. There are several 50 to 60 year old people today who wanted to retire to a vacation home or travel that now are finding themselves having to work until they die. Fortune 500 executives are now greeters at Wal-Mart because a handful of people leveraged our financial system to the brink for a commission.

1. Four Myths of Wall Street –

1.) Over the long run, the market always goes up.
The biggest trick the devil ever played is convincing the world he does not exist. This is the same as the market always goes up. There are 20 to 30 year trends from 1900-2011 that the market was flat. Thus if that was your investment time, you lose.

2.) Diversification and Asset Allocation are critical to retirement success –
Warren Buffet calls it De-worsification. Being invested in the stock market in different sectors is not diversification.

3) Major Financial Services firms give you options –
The opposite is true because the level of expertise required for true custom retirement plans does not scale well. The risk is too great.

4.) Net worth determines your Lifestyle in Retirement –
This is not true. The only thing that matters is positive net cash flow. You can have a car worth a million dollars and not have enough monthly cash to pay for the gas. Assets have to spin off monthly cash flow to be effective.

2. Lifestyle Investing- Erin has an excellent method of investing dealing with Needs, Wants, Likes and Wishes. The concept is so simple that it is brilliant. You lock in all your needs with a guaranteed investment return and then fund the other stages with different types of investments. The only investments that has guaranteed on it are U.S. Government Issues and Insurance products.

The retirement promises from big financial services firms and 401K plans are broken. “An estimated 47% of Americans born between 1948 and 1954 may not be able to afford basic expenses and uninsured health care costs through retirement.” This brings us to our third point.

3. Guaranteed Retirement Income-– Erin talks about the power of annuities after 1999. There are some strong arguments for using these types of products for your guaranteed retirement income. To divert a bit, I have employed the infinite banking concept for the guaranteed retirement income. This is by far the strongest way to build a solid nest egg and have full control of your money. Treating investing as a business is the true way to success. Both method use insurance products that provide a guaranteed investment return. Financial gurus who are in favor of mutual funds will pooh pooh this idea because the guaranteed returns may be lower than what the market returns in CERTAIN years. I can tell you from personal experience that the dot com crash and the 2008 Financial Meltdown did not affect my banking system yet some of my stock market investments went in the toilet. My guaranteed portion went unharmed. You can check out the other summaries on successprogress.com talking about infinite banking for more details.

The Big Retirement Risk shows you that survival of the fittest and nature dictate what happens in life. You need to prepare accordingly. Erin profiles in the last section 22 low probability / high impact events that you need to be protected from. That part alone makes the book worth reading.

I hope you have found this short summary useful. The key to any new idea is to work it into your daily routine until it becomes habit. Habits form in as little as 21 days. One thing you can take away from this book is guaranteed returns. You need to research insurance products and find out if they will work for you. Also, understand the savings/investing strategy for Needs, Wants, Likes and Wishes is very important if you want a secure future.